New income tax credit

Recently published in the Collection of Laws, an extensive amendment to the Enforcement Procedure Code and Civil Procedure Code among other things contains an amendment to the Income Tax Act introducing a new income tax credit for taxpayers in the…

New tax credit amounts per second and third child in 2021 taxable period

An amendment to the Income Tax Act, which is part of the amendment to the Act on State Social Aid and introduces a higher annual tax credit per second, third and any subsequent child while simultaneously abolishing the maximum monthly tax bonus…

Transfer pricing remains under tax administrators’ scrutiny

The financial administration has published information about its tax inspections focusing on transfer prices between related parties. In 2020, tax administrators carried out 249 inspections, assessing additional corporate income tax of CZK 1.4…

Amendment to VAT Act 2021: EU directive’s direct effect applicable in majority of e…

An e-commerce amendment to the EU VAT Directive has been in effect since 1 July 2021. Unfortunately, the Czech Republic has not yet implemented it: the relevant amendment to the Czech VAT Act is still awaiting approval by the Senate. In its recently…

Financial administration again answers questions about changes to tax depreciation

Even after months of the Income Tax Act’s amendment’s validity, the retroactive effect of the changes to tax depreciation has still not been fully clarified. For the third time, the financial administration has again updated the Q&A file on its…

Time test for tax exemption upon spouses’ community property settlements

The Coordination Committee of the General Financial Directorate (GFD) and the Chamber of Tax Advisers confirmed that the time test for the tax exemption of income from the sale of shares (ownership interests in a business corporation) shall not be…

Digital services tax approval on the horizon

After more than a one-year break, the government's bill on digital services tax has moved on to the next phase of the legislative process. The final third reading in the Chamber of Deputies, which will also vote on all motions to amend the bill made…

Summary of e-commerce changes (2021 VAT amendment)

From 1 July 2021, significant changes in VAT on the cross-border sale of goods over the internet enter into effect, concerning both sales within the EU and imports from third countries. The place of taxation will be the country of the recipient,…

VAT refunds post-Brexit

The General Financial Directorate has issued information on VAT refunds to UK entities after Brexit.

GFD explains new meal allowance rules

From 1 January 2021, employers may use a new form of meal contribution under the amendment to the Income Tax Act: the monetary meal allowance. The General Financial Directorate (GFD) issued information that answers some of the questions raised by…

Coordination Committee: Is compensation for unconsumed goods subject to VAT?

The Czech Chamber of Tax Advisors has come up with a proposal to unify the interpretation regarding the application of VAT in situations when the customer compensates the supplier for expenses incurred by the supplier for material unconsumed upon…

Amendment to VAT Act 2021: Goods from e-shops becoming more expensive?

From 1 July 2021, VAT will be collected on all import consignments regardless of their value. Thus, when purchasing goods from foreign e-shops, it will be necessary to consider, among other things, whether the product price includes or excludes VAT.…